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mmiller
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In an interesting move it appears based on two Form 4's filed yesterday that Mr. Lampert has distributed, pro rata, his funds' shares in Sears to the partners.  I'm not sure yet if the distribution included all shares, but it is an interesting move for those that follow the company.

 

mmiller

 

 

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Didn't Buffett do the same thing with Berkshire Hathaway stock?  His partners had the option of taking cash of $30 per share (estimate) or Berkshire stock. 

 

Whoops!  Imagine being one of the partners that took the cash - missing the opportunity to turn that $30 into $100,000 over forty/fifty years.

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If I understood the filing correctly, the following ESL entities have distributed about 4 million share to the partners:

 

- ESL Institutional Partners, L.P.

- RBS Partners, L.P.

- ESL Investment Management, L.P.

 

The remaining 60 million are still with the other two main ESL entities (ESL Investors, L.L.C. and ESL Partners, L.P.)

So now Eddie owns directly 3,825,147 shares.

Very interesting move.

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  • 5 weeks later...

This is my take on it.

AZO, AN and SHLD pretty much have 3 boards all with EL's people in place.  I believe he wants to combine all 3 companies.  If he were to merge AN and AZO into SHLD, his votes would be void and there is a conflict of interest and the vote would need to be passed by the majority of the minority shareholders.  What he has done now in distributing the shares to his partners is giving them the ability to vote for the merger as Lampert now effectively doesn't control their shares and votes.

 

Please provide any feedback if you would like.

 

Cheers

 

Michael

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Sears Auto Centers Introduce Franchise Business

http://www.prnewswire.com/news-releases/sears-auto-centers-introduce-franchise-business-84688627.html

 

A good hint of things to come at Sears Holding...

 

excerpt:

"The new Sears Auto Center franchise model is available immediately to qualified dealers.  Sears will work with dealers to offer these advantages:

+ Strength of the Sears brand and the ability to leverage Sears marketing, web presence and social networking

+ Strength of the product brands, such as DieHard and Craftsman

+ The purchasing scale necessary to achieve superior pricing on:

+ Product (tires, batteries, parts)

+ Equipment

+ Supplies

+ Sears Card acceptance

+ Systems and processes"

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The WSJ atricle touches on hard numbers that a potential franchisee will face.

 

"Franchises must pay an initial fee of $30,000 for the franchise and $3,000 a month in brand license fees for the first year and $2,000 monthly thereafter. A service license fee of 2% of prior year revenue is charged after the first year, and franchisees contribute 3% of net revenue to a marketing fund to support national advertising and activities. "

 

Cheers

 

Michael

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The WSJ atricle touches on hard numbers that a potential franchisee will face.

 

"Franchises must pay an initial fee of $30,000 for the franchise and $3,000 a month in brand license fees for the first year and $2,000 monthly thereafter. A service license fee of 2% of prior year revenue is charged after the first year, and franchisees contribute 3% of net revenue to a marketing fund to support national advertising and activities. "

 

Cheers

 

Michael

 

Nice article, thanks for the tip.

 

Found this part interesting:

"In some cases, Sears Auto Center franchises will be allowed to carry other Sears products, such as Craftsman tools, said Bill Jackson, senior vice president of Sears Holdings Corp. and president of Sears Authorized Independent Auto Centers LLC. Sears will help line up financing for car purchases, and it hopes eventually to offer Sears-backed warranties on the vehicles, Jackson said in an interview."

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